Karl Aiginger, A Comparison of the Current Crisis with the Great Depression as Regards their Depth and the Policy Responses
WIFO-Vorträge, 2009, (105), 58 Seiten
This paper compares the Great Depression and the current crisis. It builds on the existing knowledge about the problems which have lead to the current crisis, and to what extent the problems were similar or different to those of the Great Depression. The focus of this paper, however, is to report stylised facts about the depth of the crises (the extent to which GDP, manufacturing production, employment, and stock prices dropped) and how economic policy reacted during the Great Depression and today. We also investigate to what extent different regions were affected depending on the crisis and whether the synchronisation with which the current crisis spread was larger this time due to globalisation. Finally, the probability of whether the fall in production has levelled off in 2009 is assessed. How economic policy should react in this phase, specifically since unemployment will stay very high (or will further increase) is also assessed.
Forschungsbereich:Makroökonomie und europäische Wirtschaftspolitik